Electile dysfunction & totally sunk rate - What are the impacts of a Trump victory? What are the impacts of a Harris victory? How much will Powell cut rates?
And you tell me Over and over and over and over again, my friend You don't believe we're on the eve of destruction No, no, you don't believe we're on the eve of destruction
Two things that I keep being asked about:
The likely impact of the US election
How much will fed cut rates just over a week from now
The first question seems easy:
If Trump wins it will be a disaster for America. He’s totally unfit to be President. Whereas if Harris wins it will be a disaster for America and may take us further down the road to WW3. In different ways, she’s also totally unfit to be President. As is just about every candidate that the main parties have put forward since the beginning of the main parties. Like most western elections, this is just the Big-Endians fighting the Little-Endians, with both committed to preventing the people getting any power or influence.
The second question doesn’t seem too hard either. As I recently told a friend-
If things are OK to moderately bad - I expect 25 Bps + lots of cheerleading
If things are worse than that - I expect 25 Bps + lots of cheerleading (because they have to pretend that things are OK)
If things are much worse than that - I expect 25 Bps + lots of cheerleading (because they really have to pretend that things are OK)
If Fed cut 50 Bps with lots of ra-ra-ra, then that means that things are cataclysmic and they want to see whether this is enough because it’s a long time until November, especially with an election in the way
Don’t rule out an emergency policy meeting before the election. That would mean that there’s a real crisis coming…..
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